This is a fascinating interview with John Andrew Entwistle, the founder of vacation rental company Wander. The way to understand Wander is that it is a vertically integrated travel company. So unlike Airbnb, for example, Wander owns all of their real estate (vacation homes in top destinations), they property manage, they asset manage, and they are building out the technology required to connect all of this stuff.
They have also created what they are calling the first ever vacation rental REIT, which means that you can buy a piece of their real estate portfolio (currently 13 properties). In addition to being a source of cash, this creates an interesting flywheel effect where maybe you stay in a Wander and then decide to become an investor in their REIT, or vice versa.
Eventually though, Wander hopes to be just as asset light as Airbnb (which again, doesn’t own any real estate; they’re a booking platform). The idea is that REIT unit holders will ultimately own the real estate and they will be the asset manager / technology platform that sits on top. But that they will still control the entire travel experience.
John also gets into some of the specifics of how they run their business. For example, in each destination, they hire local cleaning crews and handy people (who are not Wander employees). They typically spend about 7% of the value of a property to furnish it (which is typically around $80-150k per property right now). And their average order size is around $4.5k, which suggests that people are willing to pay a premium for this vertically integrated travel experience.
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BRANDON DONNELLY 
This is a really interesting business model. I’ve often thought that the business model for condo’s -with an exit strategy defined at the outset – is a recipe for shoddy quality and abandoned buyers. This REIT model defines up-front that the buyers are interested in long-term quality (whether to occupy or rent) that would include interesting architecture and design.
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I see it as a total non-starter. 13 properties? Even at 313 there is no scale. And how will they fund the acquisition of 300, if there is minimal cash flow? I see a massive negative cash flow. The concept flies against Uber, Airbnb, eBay models. I am asking you to update this community in 3 and 5 years on the success of this business.
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Will do Michael!
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This sounds a lot like an old practice repackaged with a new name. Remember the time shares sold on vacation properties back in the 80’s? Yeah, my parents did that.
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I remember but I don’t think it’s the same. Are you invested in any REITs?
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No, I’m not. Not all timeshares are set up the same way, but from what I’ve gathered so far, the main difference is that the REIT is operated from within a trust. I’m curious to see how this plays out because of that.
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